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Luang Prabang Airport: Laos resort to grow rapidly in 2016 as AirAsia, HK Express, SilkAir enter

Analysis

Luang Prabang in Laos is emerging as one of Southeast Asia's fastest growing tourist destinations, driving rapid passenger growth with services by at least four new airlines in 2016. Thai AirAsia will become the first LCC to serve Luang Prabang Airport in Mar-2016 as it launches flights from Bangkok, ending a long battle to gain access to the previously restricted Luang Prabang market.

Malaysia AirAsia and HK Express are also planning to launch service to Luang Prabang, while Singapore Airlines regional subsidiary SilkAir is planning a new route from Singapore on a circular routing that also includes the capital Vientiane. The new SilkAir route is strategically important for the SIA Group as Laos is the only ASEAN country currently not served by any SIA Group airline.

Vientiane had approximately twice the traffic of Luang Prabang in 2015, but Luang Prabang is the bigger tourist attraction and has tremendous growth potential. Luang Prabang completed an expansion project in 2012 which enabled the airport to accommodate jets, and the Lao government is now planning to expand the tiny international passenger terminal to meet surging demand.

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